Dick Roche (Wicklow, Fianna Fail)

In framing the 2005 Estimates and the budget, the Government's primary aim is to continue support for economic growth and employment as a way of making further progress. As a result of the Government's successful management of the public finances and economy, we should remind ourselves of what we have collectively achieved because it is not just a case of Government achievement but rather of what we the people have achieved.

The general Government deficit has been lowered from close to 100% of GDP in the early 1990s to the current level of 31%, which is an extraordinary achievement. The country has enjoyed improvements in economic growth and the Government has certainly improved the revenue position. However, the Government is not just running an economy but also a State. These improvements are aimed at assisting the people. The Exchequer outturn for 2004 is now projected at approximately €2 billion better than the deficit of €2.8 billion for 2004 which was forecast in last year's budget. There is practically full employment with the unemployment rate less than 5%, which is a remarkable achievement given the situation in the not too distant past. The inflation rate at the end of 2004 will be of the order of 2.25%. It is worthwhile reminding ourselves of these matters and of what we have achieved as a nation.

Public sector expenditure is now double what it was in 1997 and has risen to €41 billion. The Government is prioritising spending in areas such as health, education, social welfare and investment in infrastructure. The Government will increase its spending on health in 2005 to €1.4 billion on a pre-budget basis. In the past four years, the Government has invested an average of approximately 5% of GDP in addressing the infrastructural deficit. This is a very important point. Senator O'Toole spoke about quality of life and this is how it is improved. I have been concentrating on the inputs and that is only one part of the story. The economy is now more viable and more progressive than one could have imagined or hoped for less than ten years ago.

The spend on the key economic and social infrastructure under the NDP is at record levels. By June 2004, the Exchequer will have provided €1.8 billion more than planned. The resources are being provided and the outputs are coming.

I ask the House to consider some of the Government's achievements in the past few years. Some 47 major roads projects were completed between 2000 and 2004. Approximately 291 km in total will be completed under the national development programme by mid-2004. Motorway standard roads to a total of 76.7 km will be completed; dual carriageway completed will be 51.8 km and single carriageway, 155.4 km.

I am aware this cannot be done without causing controversy. Some of the controversies have been extraordinarily hyped. It has been suggested that instead of looking to push the emotional button, people should adopt a logical approach. The M1 motorway to Dundalk is the longest stretch of motorway in the country and includes the very impressive Boyne cable bridge. This shows infrastructure can be fitted into sensitive environments in an attractive manner of which one can be proud. The Dublin light rail system is now operational. The Dublin Port tunnel will be incredibly important in terms of the quality of life in the city and will be completed by the fourth quarter of next year. A Dublin Bay water treatment plant costing €300 million has been installed which gives the capital a world-class water treatment facility. I ask Members to remember the situation less than ten years ago when there was an open cesspit on the outskirts of the city. Senator O'Toole referred to the rail network in which there has been a major increase in investment. In 1997 the Government of the day invested €7 million; last year the Government invested €329 million. This is probably not enough investment but it is a lot more than €7 million.

I wish to deal with some of the issues raised by Senators during the debate. Reference was made to the low level of increase in the local government fund. This is neither a fair nor an accurate observation. The 2005 Exchequer allocation for the fund is €488 million, compared with the previous year's figure of €453 million, an increase of €35 million or 8%. I am as interested in this fund as any Member of this House. I believe more efficiency can be squeezed out of the public services at local government level. By putting €488 million of taxpayers' funds into these services I will expect a better delivery of services and I am not prepared to accept the old arguments and the old shibboleths that we did not get enough. We have enough now and it is up to us to do the job in local government, both at central and national level.

During the period 1996-2004, the Exchequer contribution to the local government fund has actually increased by 150%. I am not prepared to listen to people saying we are not doing enough when not too long ago the same people, when in Government, did an awful lot less. In the area of local government, social housing is of particular interest to me. The figure this year will be €1,206 million. I remind Members and, through them, members of local authorities, that I am carrying out an analysis of performance in local government housing. It would be quite shocking and not a little embarrassing for people to look at the returns in their own local authority areas. It will come as a shock to most Members to learn that very few local authorities have met the targets set for them over the past ten years. It would be unfair of me to draw attention to one or two years but over the past ten years, if one examines the total number of allocations, the total amount of money given to local authorities to produce local authority houses, very few local authorities have come up to 100% over a ten-year period. The divergence between the targets and the reality is even worse in the short term. Adequate funding is being provided. I will be driving this particular area because I believe the Senators who made the point of the importance of this sector are correct. The Government is putting in a significant sum of money; €1.2 billion is not peanuts in anybody's language. I will expect public representatives at local government level and those on the ground to drive this issue and make sure we have delivery. I cannot go next year to the door of the Minister for Finance and look for money if I am returning €300 million or €400 million on any account.

The issue of education was raised by a number of Senators. The total increase is €544 million. We could spend the rest of the day discussing this subject on which we all have views. I share the concern expressed by Senator Maurice Hayes about research carried out in universities. I am not sure that the entire answer is to push more resources from taxpayers into the sector. Senator Henry also touched on the subject in her contribution. In my view, industry has a role to play because it should see that university research is the seed stock for future development. I agree absolutely with the point made by both the Minister for Education and Science and Senator O'Toole that primary level should receive resources. The Minister has stated she wants to promote the inclusion, participation and achievement of people from socio-economically disadvantaged areas and that is as we would all wish.

I am a little surprised at some of the comments made in this House and elsewhere on the issue of tax. On the issue of disparity, the reality is that no Government should apologise for allowing people to spend their own money. PAYE workers were crucified in this country in the past. Those PAYE workers on the average wage are now paying significantly less tax than they paid prior to 1997. In the period since 1997, the average industrial wage has increased by approximately €10,000. A person earning the average industrial wage currently pays almost €270 income tax per annum less than a person earning the average industrial wage seven years ago when it was €10,000 lower than now. These are real achievements. The best thing a State can do is keep its hands out of people's pockets, so to speak, although this is necessary to some degree to pay for vital services.

Let us take a couple of examples to highlight our recent economic performance. The average rate of income taxation for a family with one income of €50,000 fell from 33.5% in 1997 to just under 21% in 2004. This is progress because it allows people to make their own decisions and choices. In the case of a family with two incomes the figure is more dramatic, with average income taxation falling from 33.5% to 14%. As a result of the Estimates, the pre-budget gross expenditure on public services will be €43.5 billion. I could cite statistic after statistic but time is short.

The Government has prioritised the areas of importance to Senators and others who believe in education, health and welfare services. We will continue to allocate resources on the basis of priorities in the social area.

I thank Senators from all sides for their contributions. We will never be completely satisfied as to reach that point would indicate we had lost our grip. I am satisfied that this Government and its immediate predecessor have achieved a vast amount. The economy is in a good state.